Apple is now overbought after rallying to record highs this week
Apple’s rally this week has made the iPhone maker one of the most overbought stocks on Wall Street, with its newly announced push into artificial intelligence lifting shares above $200. Apple is up nearly 8% this week after unveiling an array of new AI features at its annual Worldwide Developers Conference . It’s also the second-most overbought stock on Wall Street this week based on its 14-day relative strength index, or RSI. CNBC Pro used its stock screener tool to search for the most overbought and oversold stocks. Names with a 14-day RSI exceeding 70 are considered overbought, which suggests that shares may soon slide. A reading below 30 generally signals that a stock is oversold and could be due for a bounce. Indeed, a wave of enthusiasm following the conference lifted Apple to a record close this Tuesday as investors learned of the company’s AI enhancements, including allowing Siri to tap OpenAI’s ChatGPT. The stock now has an RSI of nearly 83, and analysts see a slide of more than 3% for the name, according to LSEG. Apple’s surge comes as both the S & P 500 and Nasdaq Composite are on pace to end the week higher by more than 1 % and 3%, respectively. The 30-stock Dow Jones Industrial Average is the lone laggard, poised to end the week lower by less than 1%. Other overbought stocks this week include Nvidia , Hewlett Packard Enterprise and T.J. Maxx . Here’s a look at the full list. Broadcom has added roughly 20% this week. The company surpassed Wall Street estimates on the top and bottom lines in the fiscal second quarter. The chipmaker also announced a 10-for-1 stock split on Wednesday. This week, Bank of America went so far as to predict that Broadcom could soon join the likes of Nvidia and Microsoft in the so-called ” trillionaires club .” As of Friday, the company’s market capitalization was just shy of $800 billion. Broadcom’s shares hit a 14-day RSI of roughly 84 this week, suggesting they’re well overbought. Analysts see slightly more upside from current levels, with consensus target prices calling for a roughly 5% rise, per LSEG. Shares are up nearly 55% in 2024. AI darling Nvidia is also on a strong run, with a gain of 165% in 2024. Shares of Nvidia are also overbought this week, touting a 14-day RSI of about 81. Analysts surveyed by LSEG see the stock losing some steam, though. The average price target implies a roughly 6% dip from here. Among oversold stocks, aerospace and defense firm Northrop Grumman topped the list this week with a 14-day RSI of about 17. Shares have slipped about 10% in 2024. Analysts forecast a turnaround from here, estimating upside of nearly 20% based on consensus price targets, per LSEG. Last month , the defense giant raised its quarterly dividend by 10% to $2.06 a share. It marked Northrop Grumman’s 21st consecutive annual dividend increase. The stock now has a dividend yield of nearly 2%. Other oversold stocks this week include Tyson Foods and Paycom .
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